And whether your holiday celebrates buying gifts in a store, buying them online, or using an American Express charge card to finance the buy, your share of the holiday loot depends on your ability to sell to consumers what they want at the lowest available delivered price.
American Express does not charge interchange fees but it charges so-called merchant discount rates.
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Also, unlike Visa and MasterCard, American Express only issues charge and credit card products but not debit cards, which have been gaining widespread acceptance over the past couple of years.
American Express is able to charge a higher rate from merchants on faith of its promises to bring them higher spending customers.
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Under such a system, for example, a store owner could give a discount to someone paying with an American Express credit card, charge extra for use of a Visa charge card and leave the price unaltered for a Visa credit card.
Jones has already broken the league's stranglehold on promotional deals by selling "pouring rights" at Texas Stadium to Pepsi and making American Express the "official" Cowboys charge card four years ago.
American Express may be launching a quixotic charge at the Justice Department by fighting this case, but clearly it thinks competition means bribing consumers with goodies, not trying to make peace with merchants by reducing the discounts it demands from them.
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While this trend might have a significant positive impact to other credit card issuers, American Express has little to gain since its charge-off rates have always been the lowest.
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American Express leverages its affluent card member base to charge the retailer a higher commission on the transactions.
But for those looking for a replay of the Credit Crisis, the net charge-off numbers from American Express ( AXP), Bank of America ( BAC), Citi ( C), Capital One ( COF), Discover ( DFS), and JPMorgan Chase ( JPM) would argue against it as this data continues to improve each and every month.
American Express ( AXP), issuer of the green charge cards that are synonymous with the expense account life, has long competed against banks and, by some measures, out-earned the deposit-and-loan crowd.
Since American Express brings higher spending consumers to merchants, it can charge a higher commission (known as the interchange fee) on sales.
Plus, earnings season kicked off with Alcoa 's better than expected report, Merrill Lynch warned of wider write-downs and American Express said it would be booking a fourth-quarter charge.
Operating as a separate company with Toan in charge and backing from New York Life, Express Scripts rapidly turned profitable and began to expand, selling its services mostly to employee health plans and other small groups.
Visa and Mastercard charge a 1 percent foreign transaction fee, American Express charges 2 percent, and the companies issuing the cards can add fees of their own.
Mr. Chapman stayed with Shearson through further mergers and Mr. Weill's eventual sale of the company to American Express, where Mr. Chapman became vice chairman and in charge of developing a global private-banking network.
American Express earns revenues from card licensing fees, royalties on billings, charge volume, net spread revenue and cards in force, foreign exchange conversion revenue and also a share of the discount revenue earned by the operator.
American Express does not issue debit card products and limits its offering to credit and charge cards issued by itself and other third-party financial institutions.
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This leaves American Express in the enviable position of being able to more aggressively issue cards than its competitors given its low charge off rates.
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